5 easy changes Google could make to be less monopolistic
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The Department of Justice is preparing another antitrust case against Google. The first was filed in late 2020 and focused on Google’s dominance in search. But now, the DOJ is focused on Google’s anticompetitive practices in the digital ad space.
Digital marketers who have worked in platforms like Google Ads, the Google Display Network, and YouTube advertising during the past decade are likely not surprised. Cost-per-click prices have surged, click fraud has gotten worse and with the upcoming death of third-party cookies, digital advertising has gradually become a landscape where only Google seems to win.
The reality is, Google’s platform has helped brands in every industry jumpstart website traffic and gain market share through Google Ads campaigns. In some ways, they deserve to be as dominant as they are.
That said, Google just needs to learn how to share. With a few small changes, Google’s digital marketing ecosystem could be a more fair place for advertisers and publishers.
Here are five easy changes that Google could make to be less monopolistic.
1. Reduce the number of ads above the fold
Over the years, Google has quietly increased the number of ads that appear at the top of its search engine results pages (SERPs). In early 2020, Google also changed the appearance of their ads so they look strikingly similar to organic results.
Data has shown that these changes have helped drive more clicks toward paid ads rather than organic listings.
With most popular searches, four Google Ads appear above the fold. In the above example, the user has to scroll before even seeing any organic listings. With so much SERP real estate devoted to paid ads, Google is clearly driving users towards a click that most benefits their bottom line.
Also, Google determines the price that advertisers pay by a competitive ad auction among advertisers. The more advertisers that enter the auction, the higher bids get. This is called CPC inflation, and it has occurred in every industry. In some niches, advertisers are paying well over $200 per-click for specific search queries.
But with Google’s dominance in search, advertisers don’t have an equally viable alternative if they want to target search intent at a more affordable price. By returning to three ads above the fold, Google can help ease some of the high prices that digital advertisers are now paying.
In the long-term, this would help lower customer acquisition costs and improve return-on-ad-spend for those brands that rely on Google to drive traffic and revenue.
2. Allow advertisers to audit the quality of the clicks they buy
Over the past few years, there have been multiple class-action lawsuits filed against Google claiming that they understate click fraud. A 2020 study found the average amount of fraudulent clicks to be 14% across all industries, costing an estimated $23.7 billion to advertisers.
Click fraud is big business. It is a real problem that Google has not taken nearly enough action to resolve. Right now, if an advertiser suspects click fraud in their campaign, they can ask Google to investigate, and Google automatically will credit the account back when it identifies fraudulent clicks.
But Google alone determines whether or not those clicks are invalid. Advertisers have no window into that part of the process. Until there is a clear way for advertisers to audit the quality of the clicks that they pay for, there will always be skepticism about whether the clicks they pay for are actually qualified traffic.
Giving advertisers more insight into where their clicks come from could help make the Google Ads platform a more transparent place.
3. Decrease revenue share from Google AdSense
When it comes to the Google Display Network, Google AdSense takes about 32% of the revenue they earn from advertisers. That leaves only 68% for those publishers who actually did the work of building an audience and generating website traffic.
This revenue sharing model has gotten Google into trouble in the past. For example, Google settled a 2018 class-action settlement with publishers who claimed Google withheld some of their revenues from valid clicks.
Google search has already strained the relationship between Google and publishers. With their SERP enhancements like knowledge panels, answers, and certain rich results with schema markup, Google essentially scrapes content that other publishers create. Also, Google has a history of promoting their own content (like travel service) above other publishers.
Over the years, Google has become the gateway to the internet. This gives them immense power in the websites that internet users do and don’t visit.
If Google decreased their revenue share in AdSense, it would be a small step toward repairing the strained relationship with publishers who have worked hard to build up valuable audiences that advertisers want to target.
4. Pay publishers for featured snippets and zero-click searches
The majority of searches in Google now end without a click. These are called zero-click searches. They happen because searchers find the answer they are looking for right there in the SERP and don’t need to click over to the website where the answer came from.
Every time a zero-click search happens, the publisher who created the content that populates that featured snippet misses out on an opportunity to show that user an advertisement. Zero-click searches rose to 65% in 2020, meaning that tons of publishers are losing out on the chance to generate revenue for their own brand through advertisements.
By paying publishers for featured snippets that result in zero-click searchers, Google will help eliminate some of their own dominance by giving back to publishers (and other advertising platforms that work with those platforms) more skin in the game.
5. Divest key holdings or reveal how they leverage each other
A big part of Google’s power is not only in digital advertising, but their dominance in other markets and technologies. Naturally, Google uses these different assets to leverage the performance and profitability of their digital advertising ecosystem.
For example, Google used to scan Gmail users’ emails for advertising data -- a requirement of using the free service. Although they stopped this practice in 2017, it speaks to the wealth of user information that Google has access to through assets like Gmail, Chrome, YouTube and their search engine.
Google has always relied on user data to enhance the performance and quality of their products, but they also use that data for their own benefit. The recent critiques of their emerging FLoC technology (which would replace third-party cookies in Chrome) shows how Google actively uses their different assets to leverage and reinforce their own dominance.
Divesting some of these key assets is not an easy change to make. Most likely, it would require a successful prosecution case from the DOJ.
However, if Google found ways to be more transparent with users and the public about how exactly they leverage these assets to benefit the others or had more open-source requirements, it would go a long way in lessening their identity as a big tech monopoly.
Manick Bhan is the founder and CTO of LinkGraph, an award-winning SEO and digital marketing agency, and the creator of SearchAtlas, an all-in-one SEO toolkit. Through his agency work, thought leadership and speaking engagements, he helps brands of all sizes grow their digital presence. You can follow him at @madmanick.